QUESTION S

The following information relates to a construction contract:

Contract price

GHC $800,000$

Costs to date

GHC $320,000$

Estimated costs to complete GHC $280,000$

Estimated stage of completion $60\%$

$($a$)$ What amounts of revenue, costs and profit should be recognived in the statement of profit or loss?

$($b$)$ Take the same contract, but now assume that the business is not able to reliably estimate the cutcome of the contract although it is believed that all cons incurfed will be recoserable from the custoetier.

What amousts should be recognised for revenue, costs and profit in the statement of profit of loss?